Dubai Group, part of a conglomerate owned by the emirate’s ruler, may take longer than expected to reach an agreement with its lenders on a debt deal, a senior banker involved in the talks said on Monday.
“It is taking a bit more time,” Hussain al Qemzi, the chief executive of Noor Islamic Bank told Reuters in an interview on the sidelines of a conference.
The company is restructuring about $10 billion in debt with its creditors that comprised of about $6 billion in bank debt already disclosed, a source close to the discussions told Reuters in April.
Qemzi had said earlier this year that the Dubai Group was nearing a deal and an agreement may be signed within the second quarter.
“It is a very complex deal involving 26 banks. It is the complexity which is taking a bit of time to resolve,” Qemzi said. “My hope is we can reach a deal by end of this year but there’s no deadline.”
Dubai Group, which is the financial services arm of Dubai Holding, owned by Dubai’s ruler, focuses on banking, insurance and investments.
It has stakes in Dubai-based investment bank Shuaa Capital , Greek group Marfin Investment Group and Australian company Citigold Corp .
Given uncertainty surrounding the worth of financial stocks in recent years, these assets are difficult to value and are undesirable for many investors, thereby preventing the company from exiting its investments to raise cash.
In January, Dubai Group said it had set up two creditor committees made up of secured and unsecured lenders in order to speed up the restructuring. (Reporting by Stanley Carvalho; Writing by Praveen Menon)